{
  "title": "Price and Monetary Dynamics Under Alternative Exchange Rate Regimes",
  "publication": "IMF Working Papers, May 1, 1999",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/30/price-and-monetary-dynamics-under-alternative-exchange-rate-regimes-3019",
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  "summary": "According to theory, inflation persistence should have less variance across countries under pegged than floating exchange rates, but not necessarily a lower mean. The paper tests this prediction on postwar data for OECD countries.",
  "sections": [
    {
      "heading": "Summary",
      "content": "- Research question: Tests theoretical prediction that inflation persistence should have less variance across countries under pegged than floating exchange rates, but not necessarily a lower mean.\n- Sample: postwar data for OECD countries.\n- Key methodological note: Estimates of persistence are adjusted to allow for the upward bias created by shifts in mean inflation."
    },
    {
      "heading": "Findings on inflation persistence",
      "content": "- After allowing for upward bias from shifts in mean inflation:\n  - Persistence has a greater spread (but not a higher mean) in the floating-rate period, as predicted by theory.\n- Theoretical implication preserved: variance of persistence differs across regimes; mean persistence need not be lower under pegs."
    },
    {
      "heading": "Monetary growth and accommodation",
      "content": "- Monetary growth has been much less accommodative of inflation under floating rates.\n- Interpretation offered: this change is most probably because of shifts in monetary policy rather than shifts in exchange rate regime."
    },
    {
      "heading": "Publication and metadata (as reported)",
      "content": "- Author: M. F. Bleaney\n- Date: May 1, 1999\n- Pages: 19\n- Volume: 1999\n- Issue: 067\n- Series: Working Paper No. 1999/067\n- DOI: https://doi.org/10.5089/9781451848885.001\n- Stock No: WPIEA0671999\n- ISBN: 9781451848885\n- ISSN: 1018-5941\n- Subjects/Keywords: Consumer prices; Exchange rate arrangements; Floating exchange rates; Foreign exchange; Inflation; Inflation persistence; Prices; consumer price inflation; Consumer prices; Europe; GDP deflator; inflation differential; inflation process; inflation shock; inflation spike; money; Price; WP\n\nIMF Working Paper No. 1999/067 (M. F. Bleaney, May 1, 1999).\n\n---\n\n Content in this bundle\n\n- Price and Monetary Dynamics Under Alternative Exchange Rate Regimes - WP/99/67\n  - Price and Monetary Dynamics Under Alternative Exchange Rate Regimes - WP/99/67 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Price and Monetary Dynamics Under Alternative Exchange Rate Regimes - WP/99/67 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/30/price-and-monetary-dynamics-under-alternative-exchange-rate-regimes-3019"
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    "Authors: M. F. Bleaney",
    "Published: May 1, 1999",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451848885.001",
    "Research question: Tests theoretical prediction that inflation persistence should have less variance across countries under pegged than floating exchange rates, but not necessarily a lower mean.",
    "Sample: postwar data for OECD countries.",
    "Key methodological note: Estimates of persistence are adjusted to allow for the upward bias created by shifts in mean inflation.",
    "After allowing for upward bias from shifts in mean inflation:",
    "Theoretical implication preserved: variance of persistence differs across regimes; mean persistence need not be lower under pegs.",
    "Monetary growth has been much less accommodative of inflation under floating rates.",
    "Interpretation offered: this change is most probably because of shifts in monetary policy rather than shifts in exchange rate regime.",
    "Author: M. F. Bleaney",
    "Date: May 1, 1999",
    "Pages: 19",
    "Volume: 1999",
    "Issue: 067",
    "Series: Working Paper No. 1999/067",
    "DOI: https://doi.org/10.5089/9781451848885.001",
    "Stock No: WPIEA0671999",
    "ISBN: 9781451848885",
    "ISSN: 1018-5941",
    "Subjects/Keywords: Consumer prices; Exchange rate arrangements; Floating exchange rates; Foreign exchange; Inflation; Inflation persistence; Prices; consumer price inflation; Consumer prices; Europe; GDP deflator; inflation differential; inflation process; inflation shock; inflation spike; money; Price; WP",
    "**Price and Monetary Dynamics Under Alternative Exchange Rate Regimes - WP/99/67**"
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